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INTRODUCTION
Fraud in general poses a tremendous
threat to organizations of all types
and sizes, in all parts of the world.
Among the various kinds of fraud that organizations
might be faced with, occupational fraud is likely the The goal of the Report to the Nations
largest and most prevalent threat. Occupational is to compile detailed information
fraud —fraud committed against the organization by about occupational fraud cases in
1
its own officers, directors, or employees—constitutes five critical areas:
an attack against the organization from within, by the
very people who were entrusted to protect its assets The methods by which occupational
and resources. Since we began tracking data on fraud is committed
occupational fraud cases in 1996, we have reviewed
thousands of cases in which insiders collectively The means by which occupational frauds
stole billions of dollars from their employers, and are detected
those cases were merely a drop in the bucket. There
are millions of business and government organiza- The characteristics of the organizations
tions operating throughout the world and every one that are victimized by occupational fraud
of them, in some way, is vulnerable or potentially
vulnerable to fraud committed by their employees. The characteristics of the people who
Most of those employees will never steal or abuse commit occupational fraud
the trust that has been placed in them, but the ones The results of the cases after the frauds
who do can cause enormous damage. It is because have been detected and the perpetrators
of this risk that we continue to study these frauds identified
and publish the Report to the Nations.
This study contains an analysis of 2,690 cases of derstand occupational fraud and the impact it has on
occupational fraud that were investigated between organizations.
January 2016 and October 2017. The data present-
ed herein is based on information provided by the The data we have gathered provides a broad and
Certified Fraud Examiners who investigated those deeply representative picture of occupational fraud’s
cases. Their firsthand experience with these frauds impact. The cases in this study include frauds com-
provides an invaluable resource for helping us un- mitted against organizations in 23 major industry
categories. Victim organizations range from small local
1 Occupational fraud is defined as the use of one’s occupation for per- businesses to multinational corporations with thou-
sonal enrichment through the deliberate misuse or misapplication of the
employing organization’s resources or assets. sands of employees. These frauds were committed by
6 Introduction Report to the Nations